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ANASTÁCIO
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VÁRZEA GRANDE
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MaKING MINCEMEaTOF THE PaNTaNaL
THE MaRKETS FOR BEEF&
DRaFT - EMBaRGOED TO 3 MaRCH 2021 7PMCET
EXECUTIVE SUMMaRY
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© Maria Magdalena Arréllaga
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© Leandro Cagiano / Greenpeace
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‘ The livestock industry is not a threat to the future of the planet despite Greenpeace and certain other NGO claims. Livestock can deliver biodiversity, socio-economic development, sustainable livelihoods and meet food security goals.’1
Marcio Nappo, Director of Corporate Responsibility, JBS Brazil, February 2021
‘ The need for rapid reduction in GHG emissions from fossil fuels to meet the 1.5° or 2°C targets is widely acknowledged. We show that the same is true for food systems: Even if fossil fuel emissions were rapidly reduced, emissions from the global food system are on a trajectory that would prevent achievement of the 1.5° and 2°C targets. … [M]eeting the 1.5° and 2°C targets will likely require extensive and unprecedented changes to the global food system.’2
Michael A Clark et al, Science, November 2020
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In 2020, thanks to two consecutive years of severe
drought,3 some 30% of the Brazilian Pantanal – the
world’s largest contiguous wetland4 – burned,5
with official sources saying that the vast majority
of the fires were started by human activity.6 In
many cases ranchers are suspected of starting fires
deliberately,7 in defiance of official bans on the use of
fire introduced in July by regional governments and
presidential decree.8
Despite its value as a vital habitat for jaguars9 and
other wildlife,10 about 90% of the Brazilian Pantanal
is under self-declared land claims, where ownership
is not verified by the state.11 As a consequence, these
land claims often overlap with Indigenous lands or
public conservation units (including federal, state and
municipal reserves). In the Pantanal, these land claims
overlap with about 28% of Indigenous lands12 and 58% of
public conservation units.13 About 80% of the Pantanal is
reportedly managed as cattle ranches.14
Greenpeace International15 has identified 15
ranchers who are either current or recent (2018–
2019) suppliers of Brazil’s leading meat processors,
JBS, Marfrig and Minerva, and that are linked to the
devastating 2020 fires in the Pantanal, environmental
violations and/or property registration irregularities.16
The fires within the boundaries of the case study
properties alone burned more than 73,000 ha – an
area the size of Singapore, or about half the size of
Greater London17 – between 1 July and 27 October
2020, and in many cases appear to have contributed
to extensive burning far beyond the property limits.
These 15 ranchers were linked directly or
indirectly in 2018–2019 to at least 14 meat processing
facilities owned by JBS, Marfrig and Minerva which
trade globally. Direct trade links have been identified
from one or more of these 14 facilities to customers
including Burger King and McDonald’s, Danish
Crown Group, Nestlé, Brazil’s Pão de Açúcar
supermarket chain (a member of the French Casino
Group), Carrefour and Walmart-Chile.18 According
EXECUTIVE SUMMaRY: MaKING MINCEMEaT OF THE PaNTaNaL
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SUMMaRISE REPORTIN PIX
to shipping data, between 1 January 2019 and 31
October 2020 these 14 facilities collectively exported
over half a million tonnes of beef and beef products
worth nearly US$3 billion to markets including Hong
Kong (22%), China (21%), the EU-27 and the UK (8%)
and the USA (1%). Exports from JBS’s Pantanal-linked
facilities alone reportedly accounted for almost US$2
billion over the period, with the EU-27 and the UK
representing around 9% of the export volume and
over 13% of the value.19
Exports are a primary source of revenue
for the Brazilian operations of JBS, Marfrig and
Minerva.20 Despite the chaos and economic upheaval
caused by the global Covid-19 pandemic, Brazil’s
beef exports set a new all-time high in 2020, with
volumes reported to have reached 2 million tonnes
and revenues some US$8.4 billion – up 11% over
2019.21 The main global revenue source for JBS SA
(as for Marfrig22), however, lies in its North American
business units, with the United States accounting for
around half of the company’s global revenue in the
third quarter of 2020.23 JBS has business interests in
every continent except Antarctica;24 customers of the
company and its subsidiaries internationally include
Costco, KFC, Lidl, Mars, M&S, Nando’s, Nestlé,
Pizza Hut, Princes, Sainsbury’s, Subway, Tesco,
Walmart and YUM.25
As a result of numerous damning exposés, including
the 2009 Greenpeace report Slaughtering the AmazonSlaughtering the Amazon,26
JBS, Marfrig and Minerva first promised to deliver ‘zero
deforestation in the supply chain’ by 2011.27 But as this
investigation into their Pantanal supply base exposes,
the processors still do not have the fundamental
procedures in place to guarantee that cattle from rogue
ranchers linked to environmental destruction or legal
violations are excluded.
Proper product due diligence procedures would
mean JBS, Marfrig and Minerva only slaughter cattle
where they have established full traceability to origin.
This would also mean they could guarantee that they
exclude any cattle where there is a risk that they may
originate from destruction or degradation of natural
forests or other ecosystems, or lands that have been
exploited in violation of Indigenous Peoples’ rights or
conservation laws. When applied to ensure corporate
transparency and accountability, due diligence
procedures would mean JBS, Marfrig and Minerva
proactively identify and prevent any other adverse
human rights and environmental impacts resulting
from their own activities, from the activities of the
companies they control and from the activities of their
subcontractors and suppliers with whom they have an
established commercial relationship.
Against this background, the meat processors’
current approach to supply chain screening in the
Pantanal focuses primarily on the supply ranch, without
sufficiently considering practices in the rancher’s
other operations. This blinkered view enables the most
transparent form of cattle laundering – the potential
for ranchers to supply cattle from operations that
violate law or company policy by passing them through
approved intermediary ranches they also own before
sending them to slaughter.
Thirteen of the 15 ranchers identified by
Greenpeace were ‘tier-one’ suppliers: they directly
supplied one or more of the meat processors from an
approved ranch in 2018 or 2019.28 In the majority of
instances, the links between the case study properties
themselves and the meat processors were indirect –
cattle from those properties passed through one or
more other ranches before the final sale. However, in
most cases, the intermediary ranches were owned by
the same individual.29
The supply chain links established by Greenpeace
between the ranchers and the big three meat
processors predate the 2020 fires. As confirmed by
the company responses to Greenpeace regarding the
cases laid out in this report, the meat processors deem
that all of the ranches that directly supplied them met
their policy requirements at the time of purchase.
Further, at least 11 of the 15 ranchers apparently
remain tier-one suppliers – ie have at least one
property approved to directly supply at least one of
the meat processors.30
Disturbingly, the processors provided
no indication of having imposed meaningful
requirements on their Pantanal suppliers in light
of 2020’s bans on deliberate use of fire, or of any
intention to do so despite the evidence provided
of supply to approved ranches from problematic
ones. In the case of JBS, three of its current tier-one
approvals as well as one of its historic (2018–2019)
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trading relationships appear to violate its sourcing
policy, and its assessment of the suppliers’ compliance
conflicts with that of Minerva in some instances.31
One of Marfrig’s historic trading relationships
similarly appears to violate its sourcing policy,32
despite the company’s assertions about compliance.
Marfrig has not indicated that it intends to review
these trade relationships more closely.
As for JBS, presented with the summary findings
of this report, the company confirmed to an industry
journal that for the moment it has no intention to
exclude suppliers – tier-one or third-party – that
violate its policies. Instead, the emphasis is on getting
Amazon suppliers onto a monitoring platform by 2025:
‘Right now, we’re not going to block them
[noncompliant suppliers], we’re going to try to help
them solve the issue. Sometimes it’s paperwork,
sometimes they need to put together a conservation
plan, sometimes they need to reforest part of their
property. We are going to help them and we’re hiring
people to help these suppliers.
‘We think excluding the property and the supplier is
a negative approach. It won’t solve the problem because
they’ll go to the next meat packer and try and sell it. We
don’t want that because it won’t address the issue.’33
Such an accommodating approach sits uneasily
with JBS’s claimed ‘zero tolerance’ to deforestation and
certainly fails to send a clear message to the sector
that violations come with consequences – they seem to
come with bonuses.
Beyond the Amazon, JBS reverts to a simple
checklist of official legal findings34 in a country
where the government is systematically dismantling
environment agencies and undermining law
enforcement.35
The profound deficiencies in the meat processors’
policies and related enforcement procedures for their
Pantanal supply base help explain the sector’s failure to
end its links to environmental destruction or to close
the market to dirty suppliers. These include:
• Failure to effectively and comprehensively ban
and monitor for the deliberate use of fire, legal or
otherwise.
• Failure to effectively and comprehensively ban
and monitor for all new land clearance, not just
illegal deforestation and not just within iconic regions
such as the Amazon.36
• Failure to require, as a condition of trade,
that ranchers comply with the law and zero
deforestation policies across their operations.37
• Continued failure to proactively identify and
monitor their entire supply base (including indirect
supply and third-party suppliers), despite a 2009
agreement to achieve this in the Amazon by 2011.38
• Failure to make supply chain transparency a
condition of trade (ie requiring ranchers to disclose
the suppliers and origins of their cattle) and a model
for responsible business (ie ensuring the public
availability of data on all ranchers in the company’s
supply chain, including the locations of their
operations, in order to enable independent scrutiny of
their impact).
These failures, underpinned by lack of
transparency and traceability, both expose and
contribute to the industrial meat sector’s continued
role as a leading global driver of land-use emissions,
biodiversity loss and social injustice. Of particular
concern is the potential for cattle linked to deliberate
or illegal use of fire to find their way into the
international market.
Given such structural failings, it is untenable
for international consumer goods companies,
supermarkets and fast food companies that claim
to have zero deforestation policies to continue
to trade with the meat processors named in this
report. Further, if trade blocs such as the European
Union39 and the United Kingdom40 are to end their
consumption of products linked to environmental
destruction then they must swiftly enact and enforce
the necessary laws to ensure that products from these
groups find no place in these markets.
The overproduction of meat and dairy is literally
costing the earth. To halt and begin to reverse
the current crisis, decisive action is needed from
governments, finance and consumer companies to
shift away from industrial meat and close markets
to companies contributing to forest and ecosystem
destruction. Without these vital steps our food system
will continue to be a driving force of deforestation,
climate change and future pandemic risk.
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The map shows the point location of the Pantanal case study ranches (in red) linked to the 2020 fires, intermediary ranches (in black), and the JBS, Marfrig and Minerva slaughterhouses supplied by them. The connecting lines trace the historic (2018-2019) flow of cattle between operations. The numbers of the ranches correspond to those on the adjacent diagram.
FROM THE PaNTaNaL TO THE WORLD
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ZILIANI 7
33TOURO MORTOSERGIO JACINTOCOSTA 15
32SANTA HELENA IFABIO DEOLIVEIRALUCHESI 14
PAULO CEZARPINTO DE ARRUDA
LAGOAVERDE 31
CELSOMIURA 13 MESTICA 30
29OLHOS D' AGUAELIANA MARIALEMOS MONTEIROCONCEIÇÃO 12
28HARAS ITAPAJE VII
RAUL AMARALCAMPOS 4 ESPERANÇA 27
26ALDEIA DE ITUANAÁRIO BARNABENETO 6 RIO
VERMELHO
25SANTO ANTONIO
JOSEDALBEM 5 SANTA
CATARINA 24SANTA CATARINA
23BOA SORTE
22VITORIAADEVAIR DEOLIVEIRA 3 RECREIO
VÁRZEAFUNDA 21EDUARDO
MARIANIBITTENCOURT 11
20PEDERMEIRESNOVAS
SAMOEL ALEXANDRONISANTOS 19SETE DE
SETEMBROJOÃO FELIX PEREIRA NETO 2
ATOLEDAL
VARGAS18
FRANCISCAEVANGELISTA TEODORO DA SILVA10
SÃO BENTO
17SÃO BENTODANIEL MARTINS
FILHO 8SANTA
CECÍLIA II
RAYMUNDOVICTOR DA COSTARAMOS SHARP 9
SÃO CARLOSE SANTA MONICA
SEBASTIÃOSABINOFILHO
ESTRELA DAFRONTEIRA 16
15BOA VISITA DO TOBACOARARAS E ARARAS I
ASSED BITTARFILHO 35ÁGUA BRANCAIVANILDO DA
CUNHA MIRANDABON SUCESSO
1
JBS PONTES E LACERDASIF 51
MARFRIGBATAGUASSUSIF 4238
JBSCAMPO GRANDESIF 4400
JBSCAMPO GRANDESIF 1662
JBSARAPUTANGASIF 2979
MINERVAMIRASSOL D’OESTESIF 2910
MARFRIG PONTES E LACERDASIF 1900
MINERVAVÁRZEA GRANDESIF 2015
JBSDIAMANTINOSIF 3000
JBSÁGUA BOASIF 4121
JBSBARRA DO GARÇASSIF 42
JBSPEDRA PRETA SIF 2019
MARFRIGPARANATINGASIF 2500
MARFRIGVÁRZEA GRANDESIF 2015
JBSANASTÁCIOSIF 615
JBSCAMPO GRANDESIF 4400
6
The spider diagram shows how trade from the 15 ranchers named in the investigation entered the cattle supply of 14 JBS, Marfrig and Minerva slaughterhouses, often via ranches controlled by the same individual. These slaughterhouses export to markets around the world (shown in red on the world map).
Apparent trade links from the slaughterhouses have been compiled through photographic evidence, company disclosures and a review of what reported in Panjiva shipping data. Global food companies reportedly supplied by these facilities include Burger King and McDonald’s in Brazil, Danish Crown in Hong Kong, and Nestlé. Global retailers reportedly supplied by these facilities include the French groups Carrefour and Casino (Pão de Açúcar) in Brazil and Walmart in Chile. Importers of beef from these facilities reportedly include Germany – Frost Meat and Meat 2000 Fleisch Handels; Hong Kong – Kai Bo Frozen Meat Supermarket; Israel – Neto Malinda Trading Ltd and Shufersal; The Netherlands – FN Global Meat and Zandbergen Brothers Bv; Spain – Egatesa, Jucarne Sa, and Montesano.
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WHaT’S THE BEEF WITH JBS?
We live in a boom time for the meat industry.
Worldwide meat consumption is predicted to rise 76%
by 2050,41 with meat-heavy diets being energetically
promoted, including in emerging economies and
by fast food companies.42 Driven by its insatiable
hunger for new markets and for land on which to rear
livestock and grow soya for animal feed, the industrial
meat sector poses a threat to the global climate, to
the wildlife of some of the world’s most biodiverse
regions, to the human rights of Indigenous peoples
and other communities and to the long-term health
of populations in the West and elsewhere.43
Global meat giant JBS exemplifies and is a main
contributor to this threat. Based in São Paulo,44
JBS claims to be the world’s largest animal protein
company45 and the second-largest food company in
the world by annual sales (after Nestlé).46 It has grown
internationally through a series of acquisitions largely
funded by the state-owned Brazilian National Bank for
Economic and Social Development (BNDES),47 which
owns more than a fifth of the company.48
JBS’s impacts on the climate and on the
ecosystems of South America are profound: its
operations have been estimated to produce around half
the annual carbon emissions of fossil fuel giants such as
ExxonMobil, Shell or BP,49 largely as a result of forest
clearance linked to its cattle supply chains and the
production of soya for animal feed.50
The scale of JBS’s environmental and social
destruction became a global scandal in 2009, when
Greenpeace published a report, SSlaughtering the laughtering the
Amazon,Amazon,51 exposing how JBS and other major players
in the Brazilian beef industry were linked to hundreds
of ranches in the Amazon, including some associated
with illegal deforestation and other destructive
practices, as well as modern-day slavery. In the wake
of that report JBS and three of Brazil’s other big
meat processors signed a voluntary commitment –
the so-called ‘G4 Agreement’ – to end the purchase
of cattle whose production is linked to Amazon
deforestation, slave labour or the illegal occupation
of Indigenous lands and protected areas. The
agreement included a commitment to ensure fully
transparent monitoring, verification and reporting of
the companies’ entire supply chains (including third-
party suppliers) within two years.52
This pledge has not been honoured. For over a
decade, investigations by Greenpeace and numerous
others have repeatedly exposed JBS’s links to corruption,
deforestation and human rights violations.53 But
despite its failure to implement the terms of its 2009
commitment, as the company plans to seek listing of
its international operations on the New York Stock
Exchange (NYSE) in 202154 it appears to be attempting
to bolster its environmental image and distance itself
from its destructive legacy. In response to increasing
pressure from its customers and shareholders,55 in late
September 2020 JBS launched its new ‘Together for
the Amazon’ initiative. As well as setting up a fund to
support sustainable development and conservation
projects in the region, the company has given itself until
2025 to implement a system for monitoring the supply
of livestock to the ranches that directly supply it in the
Amazon.56 This new supply chain commitment – which
in real terms represents a step backward from the 2009
commitments – has numerous failings, chief among them:
• Failure to explicitly extend the whole of the
supply chain policy, including ‘zero tolerance for
deforestation’, beyond the Amazon
• Failure to explicitly exclude as suppliers ranchers
that use fire deliberately
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© Leandro Cagiano / Greenpeace
© Shutterstock
© Ri
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• Apparent abandoning of the transparency
component of the 2009 agreement, notably to
ensure fully transparent monitoring, verification
and reporting of the company’s entire supply
chain by 2011
• Failure to explicitly require legal and zero
deforestation policy compliance across the
operations of ranchers who supply the company
as a condition of trade
JBS’s 2020 zero deforestation commitment
applies solely to the Amazon, ignoring neighbouring
regions such as the Cerrado, said to be the world’s
most biodiverse savannah57 (from which, according
to the Trase supply chain transparency platform,
JBS sources the majority of the cattle it exports58),
and the Pantanal – both regions where the cattle
industry is also driving ecosystem conversion.59
While in climate terms the preservation of the
Amazon rainforests is a key objective in South
America, as the Intergovernmental Panel on Climate
Change’s 2019 land use report pointed out, the
prevention of widespread land use change across all
ecosystems is vital.60
The incidence of fires in the Brazilian Amazon in the
first nine months of 2020 was the highest in a decade,
and more fires than ever before were recorded in the
Pantanal over the same period.61 Still, the new JBS
initiative makes no mention at all of excluding from
the company’s supply chain ranchers who use fire
deliberately for land management or clearance, despite
the announcement of local and federal bans.62
The 2020 commitment delays supply chain
mapping in the Amazon beyond the ranches
that directly supply it until 2025, 14 years after
the original deadline.63 The proposed monitoring
platform64 itself will be confidential – ie not publicly
available for stakeholder review and scrutiny –
which abandons the original commitment to a
transparent monitoring system.
While the 2020 Amazon commitment reasserts the
company’s ‘zero tolerance for deforestation’, which was
at the heart of the original G4 Agreement, the company
also asserts that the proposed monitoring platform
will ‘ensure any cattle from producers involved in
illegal deforestation cannot enter the JBS supply chain’
(emphasis added).65
What is clear is that JBS has not immediately
extended its ‘zero tolerance’ to include clearance of
natural ecosystems beyond the Amazon. Brazil’s current
Forest Code allows the clearance of up to 80% of any
land claim in the Brazilian Pantanal and other biomes
outside the Amazon.66 Across the country, that means
some 88 million ha of native vegetation – more than
3.5 times the size of the UK67 – could be cleared legally
within existing land claims,68 despite the huge climate
and biodiversity costs.
JBS also fails to require comprehensive monitoring
of the ranchers who supply it across their operations
and across biomes. While this was not a requirement
of the G4 Agreement either, in the years since
that agreement was reached understanding of the
adequacy of its approach to due diligence within the
commodity trade has evolved. In the palm oil sector,
for example, it is widely recognised today that if the
sector is to be cleaned up, actors at all stages of the
downstream supply chain must exclude any suppliers
whose operations – including those of subsidiaries or
associates – are illegal or environmentally destructive.
This puts the appropriate emphasis on the exclusion of
rogue suppliers, not just of tainted supplies.
In the case of Brazil’s agricultural commodity
sectors, including beef and soya, this should mean
monitoring the activities of traders, ranchers and
farmers across all their operations (that is, beyond the
purchaser’s immediate supply chain), not just in the
Amazon and not just for deforestation but for other
forms of ecosystem destruction, deliberate or illegal
use of fire, unresolved land disputes and embargoes,
outstanding fines and human rights abuses including the
use of slave labour.
Considering the urgency of the global climate and
nature emergency, initiatives such as JBS’s new Amazon
supply chain pledge that are based on self-regulation
of voluntary commitments are a decade out of date in
delivery and scope. They do not represent a decisive
contribution to the radical shake-up of the global food
system that science demands and that companies,
financial institutions and governments need to deliver.
Food industry corporations that continue to source
from JBS and financial institutions that continue to
resource it are exposing themselves to financial and
reputational risk. Worse, they are contributing indirectly
to the existential risks faced by South America’s iconic
biomes and their inhabitants – and by all the inhabitants
of an overheating planet – due in large part to the
activities of the industrial meat sector. Governments
are also stakeholders with exposure to JBS, and to the
impacts of the industrial meat sector more broadly,
through sovereign investments, trade and trade deals,
and the choices they make regarding market and
financial regulation.
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